Twitter's Earlybird and the Challenge of Monetization

As Twitter’s network has continued to grow, topping more than 2 billion tweets a month (and causing some related uptime issues), the company has faced increasing pressure to monetize that user base and find some way of generating recurring revenue. Selling access to its data through the “firehose” API to search engines like Google and Microsoft is one way Twitter has done this, but it has also been experimenting with features that blend advertising and the core functionality of the service. This includes “promoted tweets,” “promoted trends” and the company’s latest offering: discount offers from advertisers through an account called @earlybird.

In a nutshell, the new feature is a special Twitter account users can follow in order to get access to time-limited offers from advertisers on a variety of products and services. The first update from the @earlybird account came on Wednesday, with a two-for-one deal from Disney Pictures for tickets to the new movie “The Sorcerer’s Apprentice.” The tweet came with a special hashtag — #SorcerersApprentice — and a link to a page describing the offer (for tickets through Fandango), shortened with Twitter’s built-in link shortener, t.co. The @earlybird account posted a followup about the offer, and another on Thursday. By Friday, the link went to a page saying the offer had been sold out.

One interesting difference between the @earlybird feature and Twitter’s other attempts at monetization is that both promoted tweets and promoted trends appear in a user’s stream or on the Twitter homepage whether the user wants them to or not. In that sense, they are more like traditional marketing and advertising on television and in newspapers or magazines, where the message appears whether the viewer or reader wants it to or not. The @earlybird account, however, requires that a user follow it in order to see the offers, meaning it requires an “opt-in” choice as opposed to appearing by default.

That makes it a lot closer to what marketers call “permission marketing” — something social networks are good at doing — rather than traditional advertising. In a recent news analysis for GigaOM Pro (subscription required), I looked at the implications of this difference and the impact it could have on Twitter. You can read the full report here.